Delay in projects costs govt Rs 55,175 cr

The United Progressive Alliance (UPA) government poured down the drain Rs 55,175 crore belonging to the Indian taxpayer between 2004 and 2010 because it failed to deliver 495 projects on time.

Out of the 601 projects undertaken between 2004-05 and 2009-10, the government delivered just 54 either on time or ahead of schedule.

“As on December 2009, out of 950 central sector projects costing more than Rs 20 crore or above under implementation, 495 are delayed,” Statistics and Programme Implementation Minister Sriprakash Jaiswal recently said in Parliament.

According to the Ministry of Statistics and Programme Implementation (MoSPI), factors like “slow progress, fund constraints, land acquisition problems, environmental clearances, delay in supply of equipment and law and order problem” have resulted into delays in government projects.

Government data show the railway ministry is culpable for the latest delay, where ministers announce new projects every year but forget about monitoring the pace of the pending ones. Recently, a minister observed at a Cabinet meeting that it would take at least three five-year plans to complete all pending railway projects.

Over the last six years, 70 railway projects have overshot their original cost estimates, incurring as much as Rs 23,295.40 crore as additional financial requirement.

The road transport and highways ministry (headed by T R Baalu in the first UPA and now by Kamal Nath) tops the list with 150 projects facing cost overruns. Praful Patel’s civil aviation ministry, however, is an exception which has shown a reduction in project expenses by 123.50 crore.
 

FROZEN MONEY
Sector/ministry	No of projects	Cost overrun (in Rs cr)
Atomic energy	4	1,254.00
Civil aviation	24	-123.50
Coal	69	2,941.36
Petroleum	39	19,159.10
Power	40	3,778.33
Railways	70	23,295.40
Road transport	150	142.60
Shipping & ports	23	203.00
Steel	31	3,265.10
Telecom	30	68.40
Urban development	13	547.10
Water resources	1	644.10
Total	495	55,175.00

“Railways, road and transport projects are most likely to post cost and time overruns as multifarious stakeholders are involved and a lot of work is based on contracts. Often, these contracts get cancelled because of various problems like land acquisition, which in turn inflates the original cost estimates,” said an official in MoSPI requesting anonymity.

Jaiswal also said, “Accountability for time and cost overruns is fixed by the respective administrative ministries. Whenever proposals for revised cost estimates are submitted by the ministries concerned for approval to the Public Investment Board and the Cabinet Committee on Infrastructure, they are also required to submit action taken report on fixing responsibilities as well as any action taken against officials concerned and agencies.”